The Hindu Business Line : Mr Balaji Rao, Asst Vice-President, Distribution Division, Karvy Stock Broking Ltd, Prof. M.R. Santhanam, Principal, Sheshadripuram Composite PU College,

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Mr Balaji Rao, Asst Vice-President, Distribution Division, Karvy Stock Broking Ltd, Prof. M.R. Santhanam, Principal, Sheshadripuram Composite PU College,

— G.R.N. Somashekar

Mr Balaji Rao (right), Assistant Vice-President, Distribution Division, Karvy Stock Broking Ltd, and Prof. M.R. Santhanam, Principal, Sheshadripuram Composite PU College, at a guest lecture organised by the BL club in Bangalore.

Our Bureau

Bangalore, Oct. 16 It is often difficult for an individual investor to realise huge gains in a short time from equities market and hence, he should look at long-term investments.

Delivering a lecture on securities trading and stock market organised by BL Club and sponsored by Syndicate Bank for the students of Seshadripuram Composite PU College, Mr Balaji Rao, Assistant Vice-President, Distribution Division, Karvy Stock Broking Ltd, said wealth creation is a process. “Just like a seed turns into a plant and into a tree and offers flowers and fruits, you need to have patience to earn gains in stocks.” Mr Rao told students that it was safe to invest in stocks and shares. However, he said, the investments should be based on sound judgment.

He provided information on various investments options people seek and said that stocks are a unique kind of investment as they allow investors to take a partial ownership in a company. Hence, the returns are potentially bigger, he said.

Quoting examples of a few companies, he said that investors have become millionaires over a period of time. He wondered why people take examples of only a few bad companies. “There are hundreds of companies in the stock market that are creating wealth,” he said.

Dwelling on various terminologies used in securities market, Mr Balaji said that initial public offering (IPO) means that a company sells its stocks to the public for the first time. A savvy and informed investor keeps a tab on IPO because it gives him first opportunity to buy stocks.

Mr Balaji said that nowadays, investors needed to open a dematerialised account to buy or sell stocks. “Demat account is just like a bank account where actual money is replaced by shares. You need to approach a depository participant (DP) to open a demat account. Suppose, your portfolio has 100 shares of A company and 50 shares of B company, all this will be reflected in your demat account. So, you don’t have to possess any physical certificates showing that you own these shares.

“They are all held electronically in your account. As you buy and sell the shares, they are adjusted in your account. Just like a bank passbook or statement, the DP will provide you with periodic statements of holdings and transactions,” he said.

Mr K. Nagaraja, Manager, Retail Banking Division, Syndicate Bank, told the students to acquire the necessary knowledge before they invest in stocks. He also spoke about “Synd Yuva”, a product launched by Syndicate Bank recently, which will benefit them immensely. Mr M.R. Santhanam, Principal, Sheshadripuram Composite PU College, was present.

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